Rate Support Grant

HC Deb 03 December 1973 vol 865 cc886-8

4. Mr. Roderick

asked the Secretary of State for Wales if he will make a statement on the meeting he had with the Welsh Counties Association on the question of rate support grant.

Mr. Peter Thomas

I met a deputation from the Welsh Counties Committee on 16th November, when it expressed to me its concern about the possible effects on Welsh local authorities of the review of rate support grant for 1974–75. Subsequently it elaborated these views in a written submission which my right hon. and learned Friend the Secretary of State for the Environment and I are considering.

Mr. Roderick

Will the Secretary of State explain why he bothered to meet the Counties Committee, and why he left it with the impression that Welsh ratepayers would have to find a further £11 million in rates whereas he left Welsh Members of Parliament with the impression that £8 million was an exaggeration? Does he not owe the House an explanaation for speaking with two voices on the same subject?

Mr. Peter Thomas

The reason why I bothered to meet the committee is that I am interested in all the arguments put forward about the new formula, which everyone agrees is necessary for the rate support grant. It is too early, as I told right hon. and hon. Gentlemen when I met them, to say what the precise effect of the new formula will be in different areas. The important thing is that we have already announced that we are considering measures to offset the effect on the domestic rate burden. We propose to put up the domestic rate element and also to have a greatly improved rate rebate scheme.

Mr. Cledwyn Hughes

Is it not the case that unless the new formula is amended every one of the new counties, except South Glamorgan, will be worse off? Will the right hon. and learned Gentleman clarify the position and give us a straight answer on that simple point?

Mr. Peter Thomas

I wish it were as simple as that. It is meaningless to make any direct comparison of the actual amounts of rate support grant payable to Welsh authorities for 1973–74 and for 1974–75 because of the changes which will take effect next year as a result of local government reorganisation.

Mr. Alec Jones

Does the Secretary of State agree that in discussing the Local Government Bill we on the Labour benches were critical of many of its provisions but were assured in Committee, on 14th March 1972, that Welsh local authorities could still look forward to the same level of support from the resources grant? Now that we are obviously not going to have this, will the right hon. and learned Gentleman confirm that we in Wales must have either higher rates or reduced services?

Mr. Peter Thomas

It is premature to say what the precise effect will be. All we can say is that there will be measures to offset the effects on the domestic rate burden.

Mr. Denzil Davies

Is the Secretary of State not aware that one effect of the new arrangements on counties like my own, the new county of Dyfed, which has large rural and industrial areas, will be to impose an additional rating burden upon the factories in the industrial areas? Is he not aware that the effect will be that these areas will suffer more than adjoining areas, such as West Glamorgan, which will not have to bear this increased burden?

Mr. Peter Thomas

I cannot accept that in its entirety. There are no such things as "new arrangements", because the submissions and views put forward by the local authority associations when they met my right hon. Friends, myself and other Ministers last week are being considered. The Government propose, after consideration, to publish a White Paper this month setting out our decisions.

Mr. George Thomas

Is the Secretary of State aware that the chief executive officers of the new shadow authorities in Wales are all grievously disturbed following the recent interviews which the representatives of the Welsh counties had with him? Will he explain why these executive officers are all under the impression that their authorities will be worse off? This doubt must be cleared up. Is the right hon. and learned Gentleman aware that the counties are writing to us and they look to us to get a clear answer from him that we in Wales will not be worse off as a result of the rate support grant arrangement? When will it be forthcoming?

Mr. Peter Thomas

As I said earlier, it is meaningless, because of local government reorganisation, to try to compare the present situation with what the situation may be in future. It is clear that there has to be a new formula. The right hon. Gentleman knows full well that the rate support grant is not one of those functions given to the Welsh Office by the Labour Government's Transfer of Functions Order.

Mr. Roderick

On a point of order, Mr. Speaker. Will you allow the Secretary of State an opportunity to withdraw a remark he made in answer to my hon. Friend the Member for Llanelly (Mr. Denzil Davies) when he said that there were no new arrangements? Would the right hon. and learned Gentleman care to withdraw that remark, since the Minister of State is at present serving on a Bill which is advocating new arrangements?

Mr. Peter Thomas

Further to that point of order, Mr. Speaker. I was talking about the formula which at the moment is still under discussion.